More than half of advisers are worried about their profitability over the next 12 months despite most expecting income growth, according to the latest Aviva Barometer.
The regular survey examining adviser sentiment in the UK market - which questioned 982 advisers across the UK - is the first Aviva has conducted since the Retail Distribution Review was implemented.
A considerable number of advisers said they had concerns around retaining a profit over the next 12 months, according to the research. More than half (52%) cited this as an issue, compared with 44% in October 2012 when the last Barometer was conducted.
Issues that have contributed to these concerns include paying for regulatory fees and professional indemnity insurance (44% and 42% respectively), and the new rules on legacy commission (36%).
Some of the ways in which advisers plan to tackle these problems include increasing their client base (40%).
Intermediary director at Aviva Andy Beswick explained that many advisers are also considering segmentation as a way of increasing efficiency. "They might be looking to provide a less sophisticated offering to the less well off clients, thereby reducing their own costs."
However, the survey also found positive sentiment in the market with 60% of advisers expecting to increase their income over the next 12 months. And almost 16% predicted their income would increase by more than 20%. Just 17% of advisers expect their income to decrease.
Beswick said: "We believe this expected income growth is related to positive fee-charging conversations with clients. Advisers have worked out how to demonstrate their value to them.
"Secondly, there are fewer advisers in the market place which will benefit those remaining."
Despite there being fewer advisers in the market, some 44% reported concerns about losing clients.
A significant percentage cited the DIY online market as a threat (43%). Advisers also had concerns about other advisory firms (31%) product providers (13%) and banks or building societies (9%).
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